What is the time frame in which ECOA requires a notice of action for a counter offer that is not accepted?

The correct answer is 90 days because the Equal Credit Opportunity Act (ECOA) mandates that lenders provide a notice of action within this time frame for any counteroffer that is not accepted by the applicant. Specifically, the ECOA requires that a lender notify a borrower of the action taken regarding a loan application, which includes situations where a counteroffer is made but not accepted. This 90-day period is established to ensure transparency and fairness in the lending process.

Timeliness in communication is essential in financial transactions, especially in housing market conditions that can change rapidly. The 90-day notice period helps to protect consumers by informing them of the status of their application and allowing them to understand the lender's position fully, facilitating their potential ability to pursue alternative financing options.

By adhering to this regulation, lenders help ensure compliance with fair lending practices that the ECOA promotes, which ultimately supports a more equitable lending environment.